At least 450 real estate closed-end private equity funds are out at a time, and if you’re not niche-y like Berlin-focused Optimum Asset Management, there’s no way you’ll beat the Blackstones of the world. (If you can't out-muscle them, out-niche them.) HQ’d in Luxembourg but focused on German real estate, Optimum (read last week’s coverage here) just tapped Chicago-based Alpha Alternatives to handle US fundraising for its Berlin-centric third fund (€250M equity, €500M investment volume). Alpha Alternatives managing partners Anthony Longo and Michael Riley, above, say it’s a niche strategy given Germany’s stability within an unstable EU, and a hedge against US uncertainty.

You've also got Berlin's high 90s occupancy rates, dearth of new development, and out-of-whack homeownership rates (just 14%), they say. Optimum’s in-house property management is a rarity for Berlin (above), and its condo conversion strategy will capture population growth and increased demand. The wall may have come down 25 years ago, but Berlin’s pricing is still bouncing back, Michael and Anthony tell us. It’s taking 12 to 18 months to raise a fund these days, they say, as opposed to just 30 to 60 days on the direct side. Alpha Alternatives generally goes out to at least 2,500 groups, endowments, pension funds, family offices, funds of funds, etc.

After meeting through a mutual acquaintance and bonding over their Big Ten connection (Michael went to Wisconsin and Anthony went to Iowa), the pair joined forces as the market was collapsing in ’08. The key to surviving in a down, musical chairs market was a pipeline to hard-to-find equity relationships (gained after years of raising capital), they say. These days, they work across the capital stack, doing direct equity and debt for JVs and single-asset transactions across the US (they’ll do $400M this year), as well as fundraising.

Here’s a shot we took inside one of Berlin’s oldest pieces of real estate, Charlottenburg Palace. Alpha does about half of its business at home in Chicago. (Recent local direct deals: office in Arlington Heights and multifamily in West Town.) Outside of the office, Anthony and Michael enjoy staying active (golf, working out) and repping Chicago sports. Though they’ll spend some much-needed warm weeks officing out of LA this winter.